May 16th 2016


Jack had been with  Slavonia Post for almost 30 years now and he was recognised as one of the most able managers in the company.  After years of declining letter revenues and major competition from private carriers in the lucrative parcel business, the organisation was not in good shape either financially or in terms of its customer offering.

Nobody had been very much surprised when, some 12 months ago he had been nominated as CEO by the Minister of Infrastructure, "If Jack can't help us, who will?" the minister was apparently quoted as saying. Since his nomination, Jack had worked tirelessly to convince his supervisory board and unions (as well as his own management team) that it was e-commerce that could save the day for Slavonia Post. Despite push back from the unions, who didn't want new work practices or PDA's (handheld terminals) which they claimed were like a "spy in the post-bag", or concerns from the Minister that the already significant financial loss would be aggravated by the investment this entailed, Jack persevered. He had even found a way to circumvent the financial restrictions on salary and hire Krys, a top CEP Manager, to head the parcel division.

Despite the barrage of criticism he had been deflecting for several weeks now, the big day had arrived. had just transferred over 70% of their business back to the postal operator. Their Regional VP had said during the negotiations that with the new customer experience Slavonia Post were offering, supported by interactive delivery, "to door", "to access point" (open 24/7 in many places and never further than 10 minutes from the consignee) and "hassle free" returns, they were clearly the best supplier in the market.

Winning just this one account, will increase parcel volumes by 30% and make the Post a leader in the segment, once again, not mentioning additional sales to the customers who come to the post to pick up their parcels.  Suddenly Jack's critics were singing a new tune... 

So how far from reality is this story? Actually, not so far at all. The largest e-commerce players  are almost always the most important parcel shippers in markets where they have a local site. Also, the National Posts almost always have the largest and most "local" infrastructure of access points due to their legacy network and universal service obligation. So why is it so difficult for many of them to make e-commerce business "theirs".

As any experienced postal manager will correctly point out, "things are not so simple", there is the issue of convincing the various, highly influential stakeholders (politicians and unions to name but two), the costs of adapting to the needs of e-commerce, not to mention the challenge of getting specialists on board who know this space.  But the benefits are clear and when you look at what some large Postal Operators La Poste or Deutsche Post are doing or other smaller, but agile Posts like Posten (NOR), Posti (FIN) or Eesti Post (EST) it is clear that success in e-commerce is not only a pipe dream.


Any comments?






May 9, 2016 


Greg loved his job in purchasing ; he was the guru of cost cutting and knew all the tricks of the trade. With his hand on his heart Greg could proudly claim that his company had the best last mile delivery rates possible. In fact, he had just managed to beat his carriers down by a further 5%...and cut the fuel surcharge to boot!

Imagine his surprise when his new boss (who had an obsession for customer experience) called him in to say that the game rules had changed, it wasn't all about price any more but about great customer experience...,of course, at an acceptable price.

He just didn't get it, but luckily he knew someone who did. His mates Krys, and Marek had set up a specialist consultancy to advise people like him on how to look at last mile from a customer perspective and maximise shareholder value and not just minimise costs. "Guys you are a Godsend" he said, once he  had understood how to play the game according to the new rules....and the customer ratings started rocketing!

As discussed in an earlier post, the "last mile' is becoming a key differentiator in customer acquisition and retention. It will be the players who are able to offer the consignee flexibility, control and quality courier interaction who will win the day. Not surprisingly, to do this, the last mile operator needs "state of the art" systems, alternatives to home delivery (such as local access points or lockers) as well as a stable team of couriers who are motivated and really care about the customer.

So what's the point here? Well, the point is that if we do the maths, we may well find that on top of saving on complaint management and reducing customer attrition, we will sell more, to more customers if we are able to make the "last mile as easy and comfortable as the first click" to order. In many cases, we have seen that on top of the long term commercial benefits, a more expensive but better last mile, is  actually cheaper  than the "low cost" alternative. 



Any views?






May 3, 2016


In 2014 Ruch's turnover was some  400mlln EUR and it is a leading press distributor with some  30% of the market reaching some 20,000 points of sale in Poland. Ruch also has a CEP product (Paczka w Ruchu).

Apparently, Eton Park are open to sell off the business units independently and while Paczka w Ruchu does appear to have preformed particularly well over the last few years, this is one of the last opportunities to invest in a last mile network of any scale in Poland (following the sale of KEX, also part of a press distribution group, to Geis in 2015).


It will be interesting to see what happens...






Jun 7, 2016


Heather was not in the best of spirits this week, since she had taken over as logistics Director for a leading e-tailer she had realized that the last mile was far from easy…especially as a large part of her assortment were white goods.

After several trial runs, she had only just found a reasonable solution for carrying what suppliers call “big, heavy & ugly” items. She had even been able to arrange some kind of interactive delivery and weekend or evening deliveries. Now she had learned that according to the so called EU “WEEE Directive” she would need to ensure that of the goods delivered (by weight), 65% of the old ones would be collected for recycling. This implied a carry in service and “swap” of items.

The problem was that in her country, there were almost no “white glove” (specialist, value added services including carry in, mounting/connection and removal of old items) suppliers with national coverage. Some of her competitors had set up "in house" last mile capability but this was expensive to set up and her boss had doubts whether they should get into an area that was not core for them.

You can imagine her delight when her XPO sales representative called, later that week, to inform her that they had just bought a local company and were about to introduce a high quality “white goods” service. “Just what the doctor ordered” she murmured to herself with a wry smile.

The WEEE Directive is actually good news for the environment but is a real challenge for e-commerce and their last mile carriers. While officially it’s the producers responsibility, it will be, in practice, the retailer who will need to organise the last mile in most cases. “Producer responsibility” means that a minimum collection rate is achieved annually. From this year, the minimum collection rate will be 45 % calculated on the basis of the total weight of WEEE collected expressed as a percentage of the average weight of EEE placed on the market in the three preceding years. Countries will need to ensure that the volume of WEEE collected evolves gradually during the period from 2016 to 2019.

From 2019, the minimum collection rate to be achieved annually will be 65 % of the average weight of EEE placed on the market in the three preceding years in the Member State concerned, or alternatively 85 % of WEEE generated on the territory of that Member State.

This means that, within a few years (unless a system of draconian fines are implemented to ensure the public recycle themselves) delivery to curb side will not be a viable solution for white goods in that most deliveries will need to be “carry in”…as well as “carry out” of the old item. Today there are very few scalable specialists in this field; Rhenus, XPO and a handful of others. This will be an interesting area of opportunity…and risk for those e-tailers who are not prepared. Any views?





11 March, 2017


According to a recent press release, tiramizoo GmbH, the German start-up with a focus on same-day, last-mile delivery, announced it has completed an investment round led by Shell Technology Ventures B.V. (STV) with coinvestment by Daimler AG.

This investment will support the development of tiramizoo’s urban logistics platform and the pursuit of new business models in the Asia-Pacific region. In addition to Shell and Daimler, tiramizoo’s major investors including DPD Germany, Bayerische Beteiligungsgesellschaft and Bayern Kapital are maintaining their investments.

tiramizoo is a leader in the new and rapidly growing sector of same-day delivery. The tiramizoo product – an app, platform and back-end technology — interfaces retailers with customers to schedule local delivery services of their purchases in over 150 cities in Germany, Austria, Sweden and The Netherlands. tiramizoo already serves international retail players such as Zalando, MediaMarkt and Saturn.

Roger Hunter, General Manager for Digital Businesses at Shell New Energies said, “We are pleased to close this deal through Shell Technology Ventures. We are impressed by tiramizoo’s deep knowledge of the urban logistics sector and their innovative technology platform. This investment will also support Shell’s strategic interest in developing new digital business models that benefit customers by facilitating the efficient movement of goods and people in crowded, growing cities.”

The financial transaction, will allow STV and tiramizoo to combine their knowledge of digitally enabled mobility services, extending the existing tiramizoo platform to build new products and expand to new markets. This novel, connected approach to transporting goods more efficiently reflects Shell’s existing interests in freight optimisation to decarbonise and improve local air quality in the transportation sector in a sustainable manner through hydrogen electric, e-mobility, biofuels and gas-to-liquids platforms.

"We are delighted that STV is on board as an investor in tiramizoo,” said Michael Löhr, Founder and Managing Director of tiramizoo. “The arrival of Shell as global energy leader means that we have a strong partner in the field of mobility and logistics services.” Managing Director Thomas Bluth adds, “We shall use the new capital to step up the development of our technology and further refine our operational processes." About tiramizoo tiramizoo GmbH is one of the most innovative logistics platforms in Germany and is the country’s leading same-day delivery provider. The company was established in 2010 by the three founders Michael Löhr, Volker Schneider and Philipp Walz. A fundamental factor in the company’s success is its proprietary software which places particular emphasis on providing a delivery service which is not just efficient, but ecological and environmentally responsible, too, with customers experiencing a relatively inexpensive, reliable and fast service. 

While it is understandable that DPD is amongst the investors and even Daimler, but Shell's leading of this round is interesting. This shows just how important last mile delivery is becoming to all assoicated sectors from e-tailers right up to fuel suppliers. Let's see if this will be the shape of things to come. Any views?